Tag: #litigation

Defendant Barred from Arguing Costs – Except Wasted Costs

Katie SpencerLeave a comment

In the recent judicial review case of Ayinde, R (On the Application of) v The London Borough of Haringey, the Defendant was barred from making submissions on general costs after failing to comply with key procedural requirements.

Background

Following the Claimant’s issuance of judicial review proceedings, the Defendant failed to acknowledge service and did not file a statement of facts and grounds of defence. As a result, the Defendant applied for relief from sanctions in an attempt to participate in arguments on costs.

Costs consequences for the Defendant

The Court refused the application, underlining the importance of strict compliance with procedural rules. Consequently, the Defendant was barred from making submissions on general costs.

Wasted Costs

However, the Court did allow the Defendant to make submissions on wasted costs. This exception arose due to the Claimant’s legal representatives citing five fictional legal authorities in their application. In response, the Court issued a wasted costs order, describing the actions as professional misconduct.

Despite being restricted from general cost arguments, the Defendant was still permitted to address the issue of wasted costs—a distinct category aimed at compensating parties for costs incurred due to improper or negligent conduct by legal professionals.

Summary

This ruling serves as a strong reminder that non-compliance with court orders or procedures can lead to severe consequences, including the loss of the right to contest key aspects of a case, particularly on costs.

Practitioners must act promptly and diligently in complying with court directions. Failure to do so risks being excluded from critical elements of litigation, especially those with significant financial impact.

Katie Spencer is a Paralegal in the Costs and Litigation Funding Department at Clarion Solicitors and can be contacted on 07741 988925 or at katie.spencer@clarionsolicitors.com.

What scope is there for the recovery of litigation related costs as financial Deputy?

Ella WilkinsonLeave a comment

There is an unavoidable overlap between deputyship costs and litigation costs where a Deputy is appointed to manage P’s property and financial affairs whilst a claim remains ongoing concerning P. This has historically been and will continue to be somewhat of a grey area. The main distinction is working out whether the time spent is to be recovered under the Deputy’s bill of costs for general management or under the litigation claim.

Costs Judge James recently offered some valuable insight on this issue, and confirmed that the SCCO take the approach that “where the Deputy is being asked to provide information and/or schedules and/or documentation to support an interim payment application in ongoing litigation, these are not general management charges. They have been brought about by the actions of the defendant to the claim and the costs should rightfully be laid at the defendant’s door and not billed to P’s estate”. The same goes for where the Deputy is asked to prepare a witness statement for use in the litigation claim, with the key takeaway being that this time (with the work ultimately being generated by the defendant) should be claimed and recovered under the litigation rather than coming at a cost to P’s estate. It is not a black and white answer as to whether you can or cannot recover this time, but a question of where the work is best placed for recovery and payment.

It is inevitable in a Court of Protection deputyship matter where there is an ongoing claim that there will be some level of maintained contact throughout the management year regarding the general progression of the claim given the financial Deputy’s obligations and responsibilities. We continue to recommend that this periodical contact be included in general management bills for assessment. However, please note that where there is a significant level of contact between the fee earners and the litigator, the SCCO may take the stance that it would be more appropriate for the time incurred to be pursued in the litigation bill of costs and recovered from the defendant.

It is recommended that Deputies also consider the cases of In re Gibsons Settlement Trusts [1981] and Hadley v Pryzbylo [2024] in considering where work is best placed to be claimed and recovered. In re Gibsons Settlement Trusts [1981] applied a three strands of reasoning test, which was affirmed in the later case of Hadley v Pryzbylo [2024]. Another interesting observation made in Hadley v Pryzbylo which highlights further the lack of certainty in approach in this regard was that “as a matter of common sense, it would be unusual to rule that any generic category of cost was irrecoverable in principle; by the same token, it would be wrong to assume that, even if the generic category is recoverable, every item that made up that category was automatically recoverable”. This further demonstrates that costs in this area do not follow a one size fits all or black and white approach.

The case of ACC and Others [2020] also touches on litigation costs incurred by Deputies and what work can be done under the general management authority for steps taken in contemplation of litigation. My colleague Leah has recently prepared a helpful summary of the main points from this judgment, which you can read here: https://clarionlegalcosts.com/2024/10/15/acc-others-a-useful-recap/

If you have any specific queries as Deputy in relation to the recovery of your work in ‘litigation support’ work, please do not hesitate to get in touch with us to discuss this.

You can find out more about our services here or you can contact the Costs and Litigation Funding team at costs.support@clarionsolicitors.com.

Avoiding Challenges to your Costs IV: Time Recording

Joanne Chase3 Comments

Time spent time recording is time well-spent. Time recording can sometimes seem onerous, particularly when in the midst of tackling some complex and urgent legal problem. However, good time recording supports strong recoveries and avoids client challenges to costs.

This is the fourth blog in a series covering various aspects of solicitor / own client relationships. You can find the other blogs here:-

Avoiding Challenges to your Costs I: Invoicing Clients

Avoiding Challenges to your Costs II: What is an Invoice

Avoiding Challenges to your Costs III: Talking about Money

What is Time Recording?

Time recording and attendance notes are often combined, but they are actually separate. Attendance notes are to keep a record of discussions and reviews of documents for the lawyer to refer to later. For example, recording the client’s instructions in relation to making an offer. The purpose of time recording is to record and justify the time spent.

Why Record Time?

Whenever a solicitor raises an invoice to their client (see Avoiding Challenges to your Costs I: Invoicing Clients) the client has a right to challenge those costs. We will consider the test for challenging costs in more detail in a future blog, but in short it is whether the costs claimed are reasonable. Alternatively, the client may be able to recover their costs from the other side.

In either case, the solicitor’s time may ultimately come under scrutiny. High quality time recording notes protect the solicitor’s time from challenge.

Key Elements of Time Recording

Every firm has different styles and standards of time recording, but it should always contain a few key elements:-

  • Who did it;
  • When it was done;
  • How Long it took;
  • What you did; and
  • Why you did it.

Most time recording will include Who, When, and How Long, but What and Why are often overlooked and sometimes missed out completely. By keeping in mind why you are time recording, you will avoid these mistakes.

How to Time Record

The Who, When and How Long will usually be recorded automatically. The What and Why will usually require the fee earner to write some kind of narrative. A time recording note does not need to be long, and in fact should usually be kept short. For example:-

Call to the client to discuss the opponent’s offer dated 1 June 2021

This note gives plenty of information to explain what was done and why it was necessary. It is clear that it was a telephone call, and that the purpose was to consider an offer.

It is also usually better to refer to individuals by their status in the proceedings rather than by name. For example, “call to Counsel” rather than “call to Steve”. This is because time recording notes are usually for the benefit of someone who was not directly involved in managing the proceedings. Using names can make it hard for a client or judge to follow, particularly when there are a lot of different people such as witnesses, experts, counsel and parties involved.

Summary

Good time recording leads to better recovery and fewer client challenges. Practicing good time recording, and training new staff to time record effectively will pay dividends in recovery rates and avoid challenges.

You can find out more about our services here or you can contact the Costs Team at CivilCosts@clarionsolicitors.com

90% Payment on Account where there is a costs budget “Still the Norm”

Bethany CollingsLeave a comment

Earlier this week, following the judgement in Puharic v Silverbond Enterprises Ltd [2021] the High Court confirmed that a 90% payment on account of costs was a reasonable sum for the claimant paying party to have to advance to the successful defendant receiving party. The Claimant had initially offered 50%.

Gavin Mansfield QC, sitting as Deputy Judge of the High Court, said: “the Claimant’s proposal fails to have regard to the developing body of law as to the relationship between costs management and detailed assessment“ and went on to comment that at detailed assessment, pursuant to CPR 3.18, the court will not depart from the approved or agreed budget unless there is a good reason to do so per MacInnes v Gross [2017]. In this case it was found that approved budgeted costs should only be reduced by a maximum of 10%.  Thomas Pink Ltd. v Victoria’s Secret UK Ltd [2014] was also referenced as an example of where 90% of the approved budgeted costs were awarded.

As no submissions were made by the Claimant in the Puharic case to suggest that there would be a good reason to depart from the approved budget, 90% of the approved budgeted costs were ordered to be paid as an interim.

In relation to incurred costs by the time of the CCMC, the Judge asserted that the same point was not applicable as these costs were not subject to the court’s approval. Guidance in accordance with the case of Excalibur Ventures LLC v Texas Keystone Inc [2015] was followed instead. The incurred costs related to the pre-action, issue/statement of case and CCMC phases. The Defendant’s incurred costs of £11,010 for the CCMC phase were recorded in the CMO as “a little high for that phase, but not significantly so” and £10,000 was deemed to be reasonable. There were no issues noted in relation to the pre-action or issue/statements of case phases and so 70% of the incurred costs were deemed a reasonable sum for the purposes of an interim payment.

In relation to the PTR phase, the Defendant sought only 50% of its budgeted costs, because even though work was carried out in this phase, the hearing was vacated.

The Claimant was ordered to make a payment on account of costs in the sum of £187,121.13.